Thailand Exports Fall as Freight Costs Rise Globally

Thailand’s export competitiveness is weakening as global freight costs have surged by 30%, raising concerns over trade volumes and consumer prices. The increase in logistics costs is already contributing to a slowdown in exports, with food export volumes dropping by 10.5% in the first two months of 2026. Industry leaders warn that the rising costs will ultimately be passed on to consumers through higher retail prices.

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The disruption is linked to ongoing geopolitical tensions affecting key global shipping routes, despite a temporary two-week ceasefire between the United States and Iran. Uncertainty continues to impact supply chains, particularly around major chokepoints such as the Strait of Hormuz and the Strait of Bab el-Mandeb. Around 30% of global cargo passes through the Suez Canal and the Bab el-Mandeb route, making any disruption highly significant for international trade.

Robin Loh, Chairman of the Singapore-Thai Chamber of Commerce and Country Director of Dawn Shipping, said Thailand faces mounting risks from elevated freight costs, disrupted routes and energy price volatility. He warned that logistics costs will continue to rise and trade flows will slow further, with consumers eventually absorbing the additional expenses. He also noted that complex regulations at customs, ports and permit systems are undermining Thailand’s regional competitiveness.

Loh pointed to the need for reforms, including streamlining administrative processes and adopting digital technologies such as artificial intelligence to improve efficiency. He highlighted Singapore as an example of successful transformation through technology-driven export-import systems. According to him, countries that enhance efficiency during global crises will be better positioned to support their economies.

Further risks remain if key shipping routes are fully disrupted, as vessels travelling between Europe and Asia may be forced to reroute via the Cape of Good Hope. This would add 12 to 14 days to journey times and reduce shipping speeds by around 30%, significantly increasing costs. However, freight rates have shown some recent easing, with the Drewry World Container Index reporting declines in rates from Shanghai to Genoa and Rotterdam.

The Nation reported the situation remains fragile as long as geopolitical tensions persist in the Middle East. While Red Sea routes are still operational and costs have stabilised for now, any escalation could trigger further supply chain disruptions. Businesses and policymakers are expected to monitor developments closely and consider measures to strengthen Thailand’s export resilience.

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Adapted by ASEAN Now Nation 12 Apr 2026